Notes 3
Entrepreneurship
A dynamic process of creating incremental wealth and impact. It is the process of
creating something new of value by devoting necessary time and effort, bearing the
accompanying financial, psychic and social risks and receiving the resulting rewards of
financial gains, personal satisfaction, and independence. Entrepreneurship as a buffer of the
national economy has become a program of world economic development (Savrul, 2017;
Valliere & Peterson, 2009). Further, the study of entrepreneurship is an important issue in
achieving social welfare from how to do business, what its competence, and how to manage
a business in today’s digital age to prosperity.
Managers and Leaders
Leaders have been characterized as inspiring or charismatic, but one rarely hears of
inspiring or charismatic managers. In the minds of many, management is associated with
words such as efficiency, planning, procedures, control, and consistency. Leadership is
associated with words such as vision, creativity, dynamism, change, and risk-taking. But are
there real differences between managers and leaders? Between leadership and
management?
According to A. D‘Souza, here are some distinctions:
1. Managers are concerned with the present. Leaders look to the future.
2. Managers make sure details are taken care of. Leaders set broad purposes and directions.
3. Managers exercise control to make sure that things work well. Leaders create
commitment that things may work better.
4. Managers solve today ‘s problems by addressing difficulties caused by changing events.
Leaders create a better future by seizing opportunities stimulated by changing events.
5. Managers focus on the process. Leaders focus on the product.
6. Managers focus on problem behavior and try to improve it through counseling, coaching,
nurturing. Leaders focus on what is right and praise it.
7. Managers make sure people put in an honest day ‘s work for their pay. Leaders inspire
people to do their best.
8. Managers organize and plan to meet this year ‘s objective. Leaders create a vision of the
years down the road.
9. Managers create efficient policies and standard operating procedures. Leaders go beyond
the need for standard procedures and create a more efficient system.
10. Managers focus on efficiency. Leaders focus on effectiveness.
In his Seven Habits of Highly Effective People, Stephen Covey stated: “Management is
bottom-line focus: How can I best accomplish certain things? Leadership deals with the top
line: what are the things I want to accomplish? Management is efficiency in climbing the
ladder of success; Leadership determines whether the ladder is leaning against the right
wall”.
Most current thinking seems to suggest that all managers should become more
leadership-oriented. Managers should not be required to become more like leaders, nor
should leaders come to value and emphasize the unique strengths of each other in order to
tap the natural tension between them to produce a “one plus one equals three “outcome.
This requires blending strong management and strong leadership into one integrated whole
where the strengths of leaders combine with, rather than clash with, the strengths of
managers, thereby minimizing the weaknesses of both.
Leadership and Management Skills - A Comparison
Both leadership and management skills are needed to build a successful organization. It
is also important to realize that the way situations are viewed depends on whether it is from
the leadership or the management perspective. The best advice is to look at situations from
both perspectives so that all aspects are understood.
The comparison that follows is presented by Anthony D‘ Souza, to assist with the
understanding of these two separate functions. In this way the best possible attributes from
both perspectives can be used, and a multiple viewpoint will become the rule rather than
the exception:
1. Leaders gain power through their actions and personal relations. Managers have
positional power on which to rely.
2. Leaders are found throughout an organization. Managers are found in the
organization ‘s higher echelons.
3. Leaders have followers who desire to be on the team. Managers have
subordinates who have been assigned to them
4. Leaders depend on people for success. Managers depend on the system for
success.
5. Leaders provide vision in terms of “the real benefit to you “. Managers use the
“this is your job” approach.
6. Leaders have self-conceived goals to better the organization. Managers attempt
to meet the goals provided by the organization.
7. Leaders strive to change the organization to best meet needs as they perceive
them. Managers work to maintain the organization ‘s status quo.
8. Leaders often view rules and procedures as bureaucratic red tape. Managers view
rules and procedures as necessary controls to provide order.
9. Leaders work for results. Managers follow directives.
10. Leaders work through their people. Managers work with charts and computer
print-out
Effective leaders build a climate of trust where people can freely express their ideas
and concerns. Such an atmosphere requires sensitive leaders who are secure in their own
knowledge, skills, and relationships rather than feel threatened by differences or resistance.
If used creatively without resentment or suppression, resistance and differences of
viewpoint can become a source of new ideas by forcing re-examination of objectives, plans,
and implementation.
Effective leaders are not only skilled in the dynamics of planned change and goal-
achievement; they also empower others. Without shared vision there would be no common
direction. Without empowerment of others, there would be no excellence in performance.
Leadership is the simultaneous provision of direction and empowerment.
Themes of Desirable and Acquirable Entrepreneurial Attitudes and Behaviors
A. Commitment and Determination
Entrepreneurial behavior is primarily self-determined behavior, that is, individuals
decide for themselves what courses of action they will follow. Determination is identified by
four essential qualities:
1. The individual acts autonomously - central to the construct of self-determination
is the notion of autonomy which is defined by Stainton as; ‘the capacity to formulate and
pursue plans and purposes which are self-determined.
2. Individual behavior - the individual needs the requisite knowledge, skills, and
experiences to implement their decision. Entrepreneurial behavior relies quite heavily on
the individual ‘s perception of themselves as being autonomous as well as having the
confidence and competence to behave entrepreneurially.
3. Self-regulated - includes self-management strategies, goal setting and attainment
behaviors, problem-solving behaviors, and observational learning strategies. Self-regulation
enables the protection of the entrepreneurial opportunity by controlling the flow of
confidential information to others and timing opportunity exploitation for maximum affect.
4. The individual acts in a self-realizing manner - they use a comprehensive and
reasonably accurate, knowledge of themselves and their strengths and limitations to act in
such manner as to capitalize on their liabilities. It is also influenced by evaluations from
significant others, reinforcement, and their beliefs in themselves regarding their own
behavior.
Entrepreneurs base their self-determination not only on their values but also on natural
inclinations, interests, and curiosities. Entrepreneurs are thus said to be intrinsically
motivated, that is, they behave as they do because the individual finds these behaviors
inherently interesting, enjoyable or satisfying. Intrinsic motivation is the key ingredient for
self-determined behavior.
B. Leadership
Leadership in entrepreneurship can be defined as the process of social influence in
which one person can enlist the aid and support of others in the accomplishment of a
common task, undertakes innovations, finance and business acumen in an effort to
transform innovations into economic goods. This refers to not only the act of
entrepreneurship as managing or starting a business but how one manages to do so by these
social processes, or leadership skills.
Entrepreneurship, in itself, can be defined as “the process by which individuals, teams,
or organizations identify and pursue entrepreneurial opportunities without being
immediately constrained by the resources they currently control “. This leads us to see that
an entrepreneur must have leadership skills or qualities in order to see potential
opportunities and act upon them. An entrepreneur, at the core, is a decision maker. Such
decisions often have an impact on an organization as a whole, which is representative of
their leadership amongst the organization.
According to Fisher, there are four phases of decision making:
1. Orientation Stage - is where the members involved are becoming aquatinted both
with themselves as well as the problem at hand.
2. Conflict Stage - is where the problem is analyzed with several possibilities
presented to resolve problem.
3. Emergence Stage - decision is made about which solution is to be used.
4. Reinforcement Stage - is support of the decision.
With the growing global market and increasing technologies, the core of
entrepreneurship- decision making- has become an ongoing process rather than isolated
incidents. This becomes knowledge management which is “identifying and harnessing
intellectual assets for organizations to “build on past experiences and create new
mechanisms for exchanging and creating knowledge.
In various cultures, the success and failures of entrepreneurs can be traced to how
leaders adapt to local conditions. A successful leader must be able to make these
adaptations and have insight into other cultures. Corporate visions, in response to the
environment are becoming transnational in nature due to the changes an organization must
make in order to operate or provide services or goods for other cultures.
C. Opportunity Obsession
Entrepreneurial behavior suggests a proactive search for opportunities within a market
and the propensity to take risks in order to achieve a certain goal. One goal of
entrepreneurial behavior is the recognition of an opportunity, then, a need for a closer
examination of what constitutes opportunity identification. In entrepreneurship there needs
to be an opportunity which is either discovered or created.
Entrepreneurial opportunity recognition by one individual differs for two reasons. First,
some individuals have better access to information about the possibilities of an
entrepreneurial opportunity. Access to key information comes about as a result of a number
of factors such as; job, experience, searching capability, social networks and the individual ‘s
absorptive capacity. Second, some individuals are simply better than others at processing
the same information because they have a better equipped cognitive capability. The ability
to process and categorize that information efficiently and effectively relies primarily on an
individual ‘s capacity and motivation to think entrepreneurially as well as their self-efficacy.
Entrepreneurs are obsessed with opportunity. Having an entrepreneurial mindset
would help established businesses to successfully identify and exploit opportunities.
D. Tolerance of risk, Ambiguity, and Uncertainty
Entrepreneurship means risk. One important aspect of entrepreneurial behavior is the
willingness to take risks. Many theoretical models have therefore assumed that
entrepreneurs are less risk averse than non-entrepreneurs It can be a powerful
energizer. It can also be overwhelming if you are not, at some level, prepared.
Here are the tips for facing the storm of risk that accompanies launching a new
venture:
1. Assess your tolerance for risk before you dive in - serious entrepreneurship is not
blind adventuring.
2. Brace your home life - the pressures of a new venture are nearly impossible to
compartmentalize. Despite your best efforts, they are almost certain to roll into your
home, your family, your love life.
3. Don’t take the entrepreneurial leap simply for money - entrepreneurs want to be
successful but follow a real passion in your venture, whatever it may be. That
passion will carry you through the days when risks and obstacles seem
insurmountable.
Ambiguity and uncertainty are an entrepreneur ‘s willingness to paint a compelling
vision and charge ahead that creates order out of chaos one step at a time. It is the
willingness to be open to new information and make mid-course corrections that mitigates
risk. The ability to do both of these at once, in the face of great uncertainty, is a tolerance for
ambiguity that sets an entrepreneur apart from the rest of the world.
The best way to develop a tolerance for ambiguity is the need for a vision. If you want
to become a successful entrepreneur, you need to be able to say things with conviction that
people will join with you.
The best way to develop a tolerance for ambiguity is to make mistakes early, cheaply,
and often. To learn that failure is a blessing, if it helps you grow. To learn that failure in
pursuit of a worthy goal is noble and that questions are more important than answers.
In essence, learning to know is important but only if it helps you learn to do and learn
to be. Life is a matter of becoming who you were meant to be by using your gifts to do
something that matters to you and others. That is the real hero ‘s journey of a principled
entrepreneur.
E. Creativity, Self-reliance, and Ability to Adapt
The seed of entrepreneurship is the ability to see things differently, to see holes in the
marketplace and devise innovations to fill them. Though it is not the only essential quality to
success, creativity may be the foundational mental skill. Entrepreneurs ask the “what if “that
drive inquisitiveness, and they are able to let go of what they already know to source fresh
information and new ways of thinking about a problem.
Some business owners however have a hard time adjusting to change and are reluctant
to adapting to new technology or even new internal changes needed for increased sales and
growth. The world of business is full of surprises and unforeseen events. Using the habit of
adaptability allows business owners to respond to circumstances with the ability to change
course and act without complete information.
F. Motivation to Excel
What is your motivation? Regain your motivation by understanding the big “why
“behind what you do. To be fully engaged in your life, you must have bigger and bolder
goals. Why do you do what you do? Do you really know? Do the people around you know?
Entrepreneurial behavior is not, however, exclusively intrinsically motivated. There will
be occasions when entrepreneurial behavior will be the result of a combination of both
intrinsic and extrinsic motivation. In other words, an individual will engage in
entrepreneurial behavior because they are intrinsically motivated to do so as well as for the
potential extrinsic rewards, they stand to gain from doing so.
Values are consequently antecedent to intrinsic motivation and provide the individual
with a sense of control over how they think and act. Individuals subjected to a more
controlling approach not only lose initiative but operate less effectively, especially when the
work they are doing requires conceptual and creative processing capability. The individual ‘s
focus to their best and to be more excelled.
So, can everyone have an entrepreneurial mind? Probably not. But with time and
practice, you can begin to think more like entrepreneurs. You can start to make subtle shifts
in old, reflexive thinking that keeps us from exploring a new idea or taking the leap and
launching your own business. Entrepreneurial thinking may be less of destination and more
of a journey as you push your own boundaries and explore exactly what you are capable of.
Entrepreneurship and Sustainable Development Goals
The 2030 Agenda for Sustainable Development, adopted by all United Nations
Member States in 2015, provides a shared blueprint for peace and prosperity for people and
the planet, now and into the future. At its heart are the 17 Sustainable Development Goals
(SDGs), which are an urgent call for action by all countries - developed and developing - in a
global partnership. They recognize that ending poverty and other deprivations must go
hand-in-hand with strategies that improve health and education, reduce inequality, and spur
economic growth – all while tackling climate change and working to preserve our oceans and
forests.
The SDGs build on decades of work by countries and the UN, including the UN
Department of Economic and Social Affairs
In June 1992, at the Earth Summit in Rio de Janeiro, Brazil, more than 178 countries
adopted Agenda 21, a comprehensive plan of action to build a global partnership for
sustainable development to improve human lives and protect the environment.
Member States unanimously adopted the Millennium Declaration at the Millennium
Summit in September 2000 at UN Headquarters in New York. The Summit led to the
elaboration of eight Millennium Development Goals (MDGs) to reduce extreme poverty by
2015.
The Johannesburg Declaration on Sustainable Development and the Plan of
Implementation, adopted at the World Summit on Sustainable Development in South Africa
in 2002, reaffirmed the global community's commitments to poverty eradication and the
environment, and built on Agenda 21 and the Millennium Declaration by including more
emphasis on multilateral partnerships.
At the United Nations Conference on Sustainable Development (Rio+20) in Rio de Janeiro,
Brazil, in June 2012, Member States adopted the outcome document "The Future We Want"
in which they decided, inter alia, to launch a process to develop a set of SDGs to build upon
the MDGs and to establish the UN High-level Political Forum on Sustainable Development.
The Rio +20 outcome also contained other measures for implementing sustainable
development, including mandates for future programmes of work in development financing,
small island developing states and more.
In 2013, the General Assembly set up a 30-member Open Working Group to develop a
proposal on the SDGs.
In January 2015, the General Assembly began the negotiation process on the post-2015
development agenda. The process culminated in the subsequent adoption of the 2030
Agenda for Sustainable Development, with 17 SDGs at its core, at the UN Sustainable
Development Summit in September 2015.
2015 was a landmark year for multilateralism and international policy shaping, with the
adoption of several major agreements:
Sendai Framework for Disaster Risk Reduction (March 2015)
Addis Ababa Action Agenda on Financing for Development (July 2015)
Transforming our world: the 2030 Agenda for Sustainable Development with its 17 SDGs was
adopted at the UN Sustainable Development Summit in New York in September 2015.
Paris Agreement on Climate Change (December 2015)
Now, the annual High-level Political Forum on Sustainable Development serves as the
central UN platform for the follow-up and review of the SDGs.
Today, the Division for Sustainable Development Goals (DSDG) in the United Nations
Department of Economic and Social Affairs (UNDESA) provides substantive support and
capacity-building for the SDGs and their related thematic issues, including water, energy,
climate, oceans, urbanization, transport, science and technology, the Global Sustainable
Development Report (GSDR), partnerships and Small Island Developing States. DSDG plays a
key role in the evaluation of UN systemwide implementation of the 2030 Agenda and on
advocacy and outreach activities relating to the SDGs. In order to make the 2030 Agenda a
reality, broad ownership of the SDGs must translate into a strong commitment by all
stakeholders to implement the global goals. DSDG aims to help facilitate this engagement.